Greenland

Greenland is a self-governing part of the Kingdom of Denmark, and its financial arrangements follow from that in a way that produces one genuine oddity.

Inside Denmark, outside the EU

Greenland joined the European Community with Denmark in 1973 and left it in 1985 following a referendum, largely over fishing rights. It is the only territory ever to have withdrawn in that way. Today it holds the status of an Overseas Country and Territory associated with the EU rather than a member.

The consequence is that EU financial services law does not apply in Greenland as it does in Denmark. Danish financial legislation is extended to Greenland through its own instruments, and Finanstilsynet — the Danish FSA — supervises the institutions operating there. In practice a Greenlandic resident deals with Danish banks under Danish rules, but the automatic operation of EU passporting and the ESMA product intervention does not follow the same route as it does in Copenhagen. Anyone opening an account should confirm with the broker which rulebook it applies to Greenlandic residents, because the answer is not always the one its Danish page assumes.

The currency

Greenland uses the Danish krone, which is itself held in a narrow band against the euro under Denmark's long-standing fixed exchange rate policy. A Greenlandic resident therefore holds a currency effectively tied to the euro, and funding a euro-denominated trading account carries minimal exchange-rate risk and a small conversion cost.

Tax

Greenland has its own tax system, separate from Denmark's, with its own rates and rules. Treatment of investment gains is a Greenlandic question, and Danish guidance does not transfer. A local adviser is the only reliable source, and this is exactly the kind of case where general summaries mislead.

Practical points

The population is small and there is no domestic brokerage industry, so residents use Danish or other European firms. Confirm the entity, the applicable rulebook and the compensation scheme covering the account — three questions, all answerable in writing before funding.